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tv   Nightly Business Report  PBS  December 14, 2017 5:00pm-5:31pm PST

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re> this is "nightly business mouse swallows fox. two of the world's biggest entertainment companies announce a blockbuster deal, increasing disney's muscle and changing the media industry as we know it. new rules of the road. the fcc moved today to reshape the future of the internet, ushering in a new era for the digital economy. and heating up. the economy is getting warmer. not just here but globally. and many hope the uptick will continue well into the new year. those stories and more tonight on "nightly business rep for thursday, decemb good evening, everyone. i'm tyler mathisen. sue herera is off tonight. the deal is sealed.
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disney in the biggest acquisition in its history will buy most of 21st century fox for $52 billion in stock. it is a transaction that will reshape the media landscape. disney already powerful in filmed entertainment and sports will become even more dominant after it folds in fox's film and tv production assets and its 22 regional sports networks. it's an offensive/defensive play aimed at fending off the rise of tech companies like netflix, amazon and others that have turned hollywood upside down. even though the deal was widely expected and first reported by cnbc last month, shares of both disney and fox were higher today. disney the best performing stock on the blue chip dow index. julia boorstin now on what's in the deal and why these two companies were eager to get it done. >> reporter: the mouse is buying the fox. disney is spending $52.4 billion in stock for fox's entertainment
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assets, including its film and tv studios, its cable entertainment network, and its international tv business including sky and star. >> the aim of this combined company is to create even more high quality content, and then to distribute it in ways that consumers prefer and consumers demand in today's world. >> reporter: disney's ceo bob iger is extending his contract for another 2 1/2 years, through 2021, to oversee the company's integration. iger stressing the potential and expanding disney's international reach and building out its direct to consumer business, beyond its espn and disney apps already in the works. >> we'll be buying control, because we'll be buying out fox's stake. with that we'll have the ability to direct hulu in ways we haven't been able to, as essentially equal partners. we'll o infuse hulu with even more content. we'll actually invest in content from both entities. >> this is gigantic. and it is just terrifying hollywood, because as it is,
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disney already has such dominant market share, especially in movies. they release few movies than other studios and still dominate in market share. >> reporter: this deal comes on the heels of the department of justice suing to block at&t's acquisition of time warner. iger says he's not concerned about getting approval for the deal. disney expects the deal to close in 12 to 18 months. >> we hope that regulatory authorities both here and in the united states look at it with the consumer in mind. >> media is no longer competing with old media. it's competing with amazon, apple, facebook, netflix. to block the ability of disney or time warner to compete against those jugger naughts is silly for the u.s. government to do. >> reporter: consumers can expect to see disney build out their popular brands such as "avatar" and to see a reunion of marvel characters with their fellow superheroes that have been thriving under disney's ownership. for "nightly business rep" i'm julia boorstin in los
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angeles. today's announcement is the capstone in the career of long time city ceo bob iger. piece by piece he's turned the company into an entertainment, resort, and merchandising behemoth and he's now positioned it f >> reporter: long island boy bob iger began his career at abc in 1974 as a studio supervisor. over the next 20 years, he rose up through the ranks, landing in senior management. under iger's leadership in the '90s, abc maintained a competitive position in the market, with leading brands including espn, lifetime, and a&e. iger played a key role in the merger between abc parent capital cities and disney back in 1996. he then joined disney senior management as the chairman of abc group. less than ten years later, in 2005, iger became disney's ceo. throughout his tenure, iger's hunger for creative content and
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leading technology have driven disney to buy content behemoths, beginning with the $7.4 billion acquisition of pixar animation studios in 2006. just three years later, disney purchased comic book publisher and movie studio marvel for $4 billion. that w 2009. in 2012, disney added another linchpin, the "star wars" mega franchise, in a $4 billion deal for lucasfilm. today's big deal dwarfs all of those. disney's deal for fox's assets is iger's capstone achievement. it represents disney's bid to bolster its content against new competitors like netflix and amazon as it builds its own streaming services business. >> robert luna joins us to talk more about disney and how it has flourished under bob iger. he's the ceo at surevest wealth
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management and owns disney shares. welcome, robert. would you buy more disney today, or did you? >> we've been buying over the last couple of days, tyler, and we've added to our position this morning. we're pretty happy about that in the short run. >> so you like the scope of this, you like what it does for disney? >> absolutely. we had $125 price target on the stock 12 months out, prior to this announcement. i was on last month, we talked about, you know, how synergistic this would be for the company. we've un to $130. we think this deal in all aspects makes a lot of sense. it's the traditional playbook that bob iger started with the acquisition of pixar, that he's picking up here, albeit a much bigger bite he's taking, near $60 million with the assumption of debt. we think it will play out as well as the other acquisitions have played out for disney
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shareholders. >> for my money, bob iger is one of the more successful ceos in media, or maybe more broadly, in the country. did you think he would be such a fearless deal maker? >> not too bad for a boy from long island. bob iger has been an absolute monster in media. while not necessarily the innovator that people like steve jobs were, iger has the potential to really pick great people, surround himself with smart people, inspire them, give them the tools they need to innovate and get out of their way. he's been really good at that. the types of deals he's bitten off, whether it was pixar for $8 billion, then lucas or marchv vil- marvel, everybody has talked about him overpaying. but when you look at how much he's made for those, at the end of the he probably underpaid for those. there's a lot of skeptics surrounding this deal, saying he's overpaying, that he's late to the party because of cord
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cutting. but i think he's going to make them eat their words here probably in another year or two when we see this play out. >> he's relatively young, he's in great shape, he's going to extend his contract, which must give investors like you some comfort. we characterize this acquisition as an offensive/defensive play. do you see it that way? >> yeah, i think so, because let's be honest, netflix is a juggernaut on its own. they're spending $8 billion next yew battl to battle incumbents like disney. they can't fall asleep at the wheel. to do nothi absolutel is not a strategy. bob iger is famous for saying, you know, they to continually challenge the status quo. sitting there and resting on their laurels is not an option for him. it is defensive. but also offensively. a lot of people are looking at this saying he's late to the party with cord cutting, he has to make that move. but when you look deeper into th deal, the bigger picture, and it could be the bigger growth story other than direct to consumer and those types of
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things that disney is getting into, is this international expansion, picking up sky, expanding the region to europe. and the big market for disney right now, india, they're picking up 140 million direct subscribers through star india. and they're really getting to india's heart because they're getting that regional sports network of cricket, which is huge in india. this is a market i think disney really wants to play in. and i think the bigger global story with the shanghai park that just recently launched, these acquisitions, is also going to play out well for disney in the long run. >> i think you're exactly right and it's probably something we haven't paid as much attention to as we should have, that international piece of the puzzle. robert luna with surevest wealth management, thank you. another groundbreaking event took place in washington today. the fcc voted to repeal some of the obama era rules governing the internet. a sweeping act of deregulation that could radically change consumers' online experiences.
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regulators will now allow internet providers to speed up access to some websites, slow down or block others. it's a win for service providers. and the vote was defended by the >> returning to the legal framework that governed the internet from president clinton's pronouncement in 1996 until 2015 is not going to destroy the internet. it is not going to end the internet as we know it. it is not going to kill democracy. it is not going to stifle free expression online. >> and fcc commissioner klieburn disagreed, and vehemently. >> a soon-to-be-toothless fcc is handing the keys to the internet, the internet, one of the most remarkable, empowering, enabling inventions of our lifetime, over to a havenful of multibillion dollar
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corporations. >> protesters rallied outside the agency's headquarters in d.c., urging the commissioners to reconsider. following the vote, some states say they plan to sue. so what the rollback of the internet rules mean for big media companies or the telecom companies? matt harrigan is senior media analyst at buckingham research and he joins us now to discuss it. matt, who is right there, commissioner cliburn or chairman pai? >> i think you can make arguments for both sides. i probably tend to side slightly more with chairman pai. i think it's really jockeying for position on who is going to make the profits off the internet. to give you an example, over in europe, supposedly google, facebook, et cetera are taking about $100 million a day in profits from telecom companies y 150 or thereabouts in north america. basically i don't thi this is going to be anything that causes any rationing in prices for
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consumers. but who really has free rein, is it the telecom companies building the networks, the the disneys. >> am i wrong in feeling that the rollback of these obama era rules gives the internet service providers, whether it's a cable company, a telecom company, more power of pricing and if so, who is going to end up paying more for the premier access on those networks? >> again, i don't think the consumer is going to pay more, because that would be making even more politicized, and you probably wouldn't have this change lasting very long. you could have legislative action. i think it's a matter of the pricing of the internet conn paying a premiumt liane,
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if you will, that's what it comes down to, as opposed to something that's coming immediately out of the consumer's wallet. >> it could cost businesses that provide or that stream content more, they may have to pay more. will that then affect their profits, whether it's a google, a netflix, an amazon? >> some of these companies are so evolved like a netflix, if you really had a change in the regulatory playing field, netflix may not have become the monster it's become today. it's hard to see how they could be badly hurt. some of these telecom executives, if you're ceo of verizon or comcast, you're probably looking at the market cap of a google or facebook and trying to figu how much of that was appropriated from your investment in your network. and of course these are very difficult resolve. you need innovation in terms of the network, building out 5g wireless and all that, and you also need innovation and content.
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i think the scariest aspect is you don't want a status quo wher a few winners morning the telecom companies and the people already there on the content side, netflix and disney as some of your other guests have eloquently expressed. you really want to see more skunkworks innovation coming out of silicon valley and other places. i thin the danger here is it perhaps stifles that a little bit. this is maybe where i side a little bit with commissioner cl matt, thank you for your specters, with buckingham research. it may be getting cold outside. it appea
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on wall street, the dow snapped a five-day win streak as some republican senators raised concerns about the tax bill. among them, marco rubio of florida, who sail vote against the proposal unless he can get an expansion of the child tax care credit. and senator mike lee said else also undecided. as one strategist put it, this market is moving in lockstep with the progress being made on the tax bill. and when there are questions, you'll get some volatility, as we saw today. the dow jones industrial e fell 76 points to 24,508. nasdaq was off 19. the s&p 500 down 10. president trump touted his rollback of regulations, calling them far-reaching, touching industries from financial services to health care to the environment. >> regulation is a stealth
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taxation. so many of these enormous regulatory burdens were imposed on our citizens with no debate, and no accountability. now there is accountability. >> the president said there are decades of excess regulations to remove. he's challenging his cabinet to find and remove what he calls every single outdated, unlawful, and excessive regulation on the books. also in washington, paul ryan, the speaker of the house, reportedly thinking about leaving congress after the 2018 midterm elections. as first reported by politico, ryan said he was tiring of d.c. even before accepting the speak denied that report when asked today if he was quittg soon, he laughed and said, "i'm not, no." the number of americans filing new applications for unemployment benefits fell last week. jobless claims decreased by 11,000 last week to 225,000, the second lowest reading since
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1973. claims are considered a proxy for layoffs across the u.s. the low unemployment rate is one of the reasons why the economy appears to be on such solid footing and getting stronger. steve liesman takes a look at the upbe >> reporter: it's almost winter. but suddenly growth seems to be springing up all over. on wednesday, the federal reserve raised its forecast for 2018 gdp by 4/10ths to 2.5%. >> we're enjoying solid economic growth with low inflation and the risks in the global economy look more balanced than they have in many years. >> reporter: not to be outdone, the european central bank raised its forecast to 2.3%, a 5/10ths increase. >> our new projections indicate a strong pace of economic expansion, and a significant
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improvement in the growth outlook. >> reporte the u.s. government today reported that shoppers seemed to hit the stores with gusto in november. retail sales were more than three times expectations. it was one of the best november gains for retail sales in 13 years. americans spent more on gasoline. but they had plenty left over to buy electronics and appliances. online retailers' sales surged in november. the question is whether consumers can keep up the pace. sometimes strong november sales mean consumers did their shopping early and december can suffer. or maybe yellen had it right, the november sales are just the leading edge of an uptick that will run through the holiday season into next year. for "nightly business rep i'm steve liesman. teva pharmaceuticals will
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cut 14,000 jobs. that's where we begin tonight's market focus. the israeli drug maker said it would eliminate more than a quarter of its total workforce as part of a plan to cut $3 billion within two years. teva said it will also suspend dividend payouts to shareholders. teva's shares nonetheless were higher today. cnbc says snyders lance is considering a potential sale to campbell soup. snyders is weighing the sale. it rose 5% to $44.42. campbell fell about 1.5% to $48.56. costco reported earnings that beat analysts' estimates after the bell. the wholesale retailer said net sales rose more than 13% year over year. shares of costco were volatile
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after hours and during regular session were off to $186.53. oracle reported second quarter profits that beat analysts' estimates. the software company said a 44% growth in cloud revenue drove results. that wasn't enough for some expectations and that sent oracle initially lower after hours. shares were up a fraction in at it regular session to $50.19. the devastating opioid epidemic hasn't gone unnoticed by silicon valley. some startups and venture capitalists are taking a uniquely tech approach to the crisis. lipton has the story from san francisco. >> families and citizens are dealing with the worst drug crisis in american history. >> reporter: president donald trump recently declared opioid e a national public health emergency. since 2000, more than 300,000 americans have died from overdoses involving these drugs. now tech entrepreneurs and
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investors are pouring money into the space and attacking the problem in multiple ways. take a startup called pair therapeutics which recently raised $20 million from investors and has created an app called reset o to analyze opioid addiction. patients receive a prescription and pass code from their health care providers. they tell the app the strength of their cravings and use a ratings system to monitor their feelings of anger, pain, and loneliness. th data is meant to offer addicts greater insight about their addiction when they are most likely to abuse opioids and what triggers their cravings. pair hopes to launch reset o in 2018. dr. brennan spiegel, director of health services research for cedar sinai health system, has a different approach, giving patients an alternative to opioids by using virtual reality. spiegel conducted multiple clinical trials to test whether virtual reality goggles can
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reduce pain. in a study, he gave half the participants video goggles to watch while the others watched videos on tv. those who watched vr reported a than the others. >> it doesn't just work during the vr treatment. it seems to continue, like the brain has been nudged in a new direction or even temporarily inoculated against pain, even after we remove the vr headsets. >> reporter: entrepreneurs know that technology can be leveraged in ways to fight opioid addiction. the stakes are high. time will tell if we ever see solutions. for "nightly business rep lipton in san francisco. coming up, santa's elves are driving trucks. >> reporter: i'm morgan brennan in the bronx. it's crunch time ahead of christmas. i'll tell you how fedex is
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handling the ups says deliveries are back to normal after an online shopping surge that caused some delays. keeping things running smooth is no easy feat for ups or rival fedex during what's expected to be a record demand for deliveries. morgan brennan reports from >> reporter: rosemary has been delivering fedex packages to
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homes for 12 years. she fills in for different routes as needed each day. this time of year, that means more shifts and longer hours. >> i actually love it. it's just a go, go, go, go time of the year for me. a lot more hours than normal. but it's g . >> repor with eight delivery days until christmas, it's run of time for the parcel carriers. fed le rival ups, has invested billions into its new network, opening new hubs and adding new aircraft. >> seasonal workers, extra equipment, rental vehicles that e to bring on. you can see some right here. >> reporter: she's the fedex managing director. she makes sure packages get there on time. >> we're anticipating that obviously with a few more days to g the holiday season, that we'll get busier as the days go on.
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but we're ready for it. >> reporter: fedex expects another record peak holiday season. expect it to delivery 380 million to 400 million packages like these between thanksgiving and year's end. it's getting creative with how some shipments reach consumers. they've partnered with walgreen's, reducing redelivery attempts. for consumers, packages are safe from porch pilots. and for walgreen's, it gets foot traffic into stores. ups has been taking similar steps. amazon is expected to use whole foods in the same way. all part of a multipronged delivery approach as e-commerce continues to surge. >> fedex and ups continue to modify their networks, expanding where they see bottle nenecks i
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the system. >> reporter: right n fedex isn't planning to delivery any packages on christmas or christmas eve, because it falls on sunday. but if last minute demand you'll have to work this christmas? >> i'm hoping i don't have to, but if i do, i don't have a problem with it. santa's little helpers, that's what we are. >> reporter: morgan brennan in the bronx, new york. " for tonight.ghtly business i'm tyler mathisen. thanks so much for joining us. have a great evening, everybody, and we'll see you r
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for several centuries, scotland was ruled from london.
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parliament hadn't met here since 1707. recently, the scots voted to bring their parliament home, and london didn't object. in the year 2000, edinburgh resumed its position as home of scotland's parliament. scotland's strikingly modern parliament building opened in 2004. the catalan architect enric miralles mixed bold windows, wild angles, and organic themes into a startling complex that would, as he envisioned, "surge from out of the rock and into the city."
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>> this is "bbc world news america." funding of this presentation is made possible by the freeman foundation, and kovler foundation, pursuing solutions for america's neglected needs. >> planning a vacation escape that is relaxing, inviting, and exciting is a lot easier than you think. you can find it here in aruba. families, couples, and friends can all find their escape on the island with warm, sunny days, cooling trade winds, and the crystal blue caribbean sea.


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